Few of us spend time thinking about signature flags on applications, but if you use them to flag where a customer should sign, you might be subjecting yourself to a potential claim: At least so says the Insurance Agents & Brokers Association.

It should be clear, that using harmless ways, like post-it notes and signature flags on applications, to direct a client where to sign are NOT illegal or unethical. But, IA&B says “. . . by using a ‘sign here’ flag, . . . [clients might say] they were misled into signing something that they did not intend to sign or into selecting a limit they did not intend to select.”

Are you kidding?

No. Applications are serious business where a mistake can void or decline a policy. Or, the coverage or limits you filled in for your client may not match what they really intended. Giving the customer a shortcut to sign (using signature flags) might be a signal to them that you have taken care of everything and they don’t even have to read the application.

So what do you do? Well, the IA&B says if you want to use signature flags, “. . . take every precaution to insure that the line you are asking the client to sign is the correct line, and perhaps include in the cover letter to a request to the client to double-check the selections that are being made . . . ”

I also always recommend keeping copies of any documents involved in the application process and detailed notes about conversations had with clients. Keep a copy of your cover letter that includes your instructions to read the application thoroughly and carefully. You may also remind your clients that their signature is not just a formality, it verifies that they have read and agree to the details in the application.

Doing a little due diligence could save you from an unfortunate situation.